Jetstar signs technology outsourcing deal with Telstra

Jetstar has signed a multi million dollar outsourcing deal with Telstra, to run sigificant parts of its technology Reuters

James Hutchinson

Low-cost airline Jetstar has signed a three-year deal worth tens of millions of dollars to outsource much of its technology management and procurement to Telstra, in a contract the telecommunications giant says is its largest outside of Australia to date.

The new deal will see Telstra hire dedicated staff to manage Jetstar’s communications network, technology procurement services, IT finances and project change.

The Qantas subsidiary has typically run a very lean operation of just six technology staff. Much of its operations have been handled in recent years by other companies including IBM, Capgemini and smaller companies. It has previously held an agreement with Telstra for telecommunications infrastructure.

A Telstra spokesman would not reveal the exact cost of the three-year deal, but it is believed to be in the seven figures.

The deal would provide a boost for Telstra’s ongoing push into Asia. Revenues for its NAS business, which includes major corporations and government clients in Australia, grew 10.5 per cent to $1.3 billion during 2012.

Chief operating officer Brendon Riley told The Australian Financial Review last month that the company hoped to grow NAS into a “multi-billion-dollar business”.